RESEARCH & ANALYSIS USING THE ANNUAL REPORT

Obtain Verizon Communications, Inc.'s most current annual report either through the ‘‘Investor Relations'' portion of their website (do a web search for Verizon Com- munications investor relations) or go to http://www.sec.gov and click ‘‘search for company filings'' under ‘‘Filings & Forms (EDGAR).''

Required:

1. What method of depreciation does Verizon use? What are the typical useful lives of Verizon's operating assets?

2. What is the cost of Verizon's property, plant, and equipment? List the major compo- nents of Verizon's property, plant, and equipment.

3. What amount of accumulated depreciation is associated with property, plant, and equipment?

4. Refer to the statement of cash flows:

a. What is the amount of depreciation expense reported for each of the last three years?

b. How much did Verizon spend on the acquisition of operating assets (capital expenditures) in each of the last three years?

c. How much property, plant, and equipment was disposed of in the last year?

d. Is the change in depreciation expense consistent with the pattern of capital expenditures observed? Why or why not?

5. What is the change in accumulated depreciation for the most recent year? Is this change explained by the depreciation expense reported? If not, what other items might cause accumulated depreciation to change?

6. Describe Verizon's capital expenditure plans for the future.

7. Explain Verizon's accounting policy with regard to intangible assets.

8. List the types of intangible assets that Verizon possesses. What is Verizon's largest intangible asset?